SINGAPORE – Undaunted by the spate of global terror attacks over the past year, Singaporeans’ appetite for travel stay unabated, say travel agents.
While popular destinations like London and Paris remain attractive due mainly to the strong Singapore dollar against the British pound and Euro, however, Singaporeans are putting off travel to the United States.
Local tour agency Dynasty Travel said it has seen a 30% drop in holiday bookings to the US for the first three months of this year, against the same period last year, TODAY reported.
Although people continue to travel to the US for business and studies, demand for leisure travel has taken a hit despite the lower airfares — which have gone down by 15 to 20%, said Ms Alicia Seah, director of marketing and communications at Dynasty Travel.
While this could be partly due to the strident anti-immigration rhetoric by US President Donald Trump, the strong US dollar is likely to be a consideration as well.
Travel agents that TODAY spoke to say they have not had requests for cancellations in the wake of recent terror attacks in Europe.
In fact travellers today are packing in much more into their itineraries, thanks to the favourable exchange rates and attractive offers being thrown in by attractions, hotels and airlines. Interest in off-the-beaten-path destinations like Croatia, Bavaria, Iceland the Balkans has also picked up, according to Dynasty Travel.
“We did not receive any calls of concern from customers to change their holiday plans or avoid specific destinations. On the contrary, demand for Europe remains consistently strong and is one of the top three choices for Singaporeans,” said a spokesperson at tour operator Chan Brothers Travel.
Increased security risk however has turned Singaporeans away from hotspots in the Middle East.
Bookings for trips to Egypt has plummeted to a third of the 1,200 to 1,500 packages sold in 2012-2013, with just 500 tours last year, according to Dynasty Travel. Similarly, Turkey has also seen a sharp drop in travel bookings.
Tour operators say Singaporean travellers are now more likely to be informed and vigilant when travelling overseas.
Moreover, the travel industry has become more resilient to shocks with destinations bouncing back more rapidly after disruptions like terror attacks.
“Tourists have developed a carry-on-as-normal attitude in response to terrorism,” said Dynasty Travel’s Seah.
The Bangkok explosion late last year and Bali bombings in popular tourist areas did not deter Singapore visitors from flocking back within a month of the incidents. As long as there are no major infrastructure disruptions such as closure of airports and railways, all tours depart as per normal, she added.
Travellers like Vidhi Joshi, a shipping industry professional, feel that the lower costs outweigh the increased security risk.
“We have been spending more on travel over the past two years as the airfares and hotel room rates are so compelling. We can’t really overcome this feeling of losing out if we don’t grab these deals. Terrorism-related and other risks will remain. It can’t really stop people from going on holidays,” she said.
Local travellers are also increasingly turning to places like Taiwan, China, Indonesia and Vietnam, where they have higher spending power with the relatively strong home currency. Cheap air tickets fuelled by rising competition among airlines serving these destinations is further propelling the traffic to these destinations.
According to online travel agency Expedia, Singaporeans are more cost conscious and seek a good bargain, when shopping for travel deals. Thailand, Malaysia, Hong Kong and Japan were some of the more popular countries that Singaporeans travelled to in 2016.
“As the Singapore dollar continues to strengthen against currencies within the sub-region of South-east Asia, we foresee more and more locals frequenting these top destinations either for a short weekend, or for year-end get-aways,” said Simon Fiquet, Expedia’s general manager for South-east Asia and India.
With Singaporeans’ penchant for overseas travel continuing to stay strong, insurance companies, in the meanwhile, are seeing demand for their travel products surge.
AIG Singapore for instance has seen a double-digit increase in the purchase of its travel insurance product Travel Guard since 2015. Last year, AIG Singapore issued around 800,000 Travel Guard policies and the company predicts that demand for travel insurance will grow by a high single-digit percentage this year.
Global consultancy firm Aon Risk Solutions estimates that the Singapore market for global terrorism insurance is worth about US$100 million (S$140 million) in premiums.
“This growth in demand is due to a number of factors, including higher mobility among Singaporeans who are travelling overseas more frequently, as well as greater awareness among consumers. Travel risks are top-of-mind for many travellers, resulting in more of them insuring themselves against unforeseen circumstances,” Ignatius Chng, vice-president and head of group personal insurance at AIG Singapore told TODAY.
The insurance major also noted that travel insurance claims relating to socio-political volatility have more than doubled in the last three years, where people had their travel disrupted as a result of political instability, coup d’etat, increased border security, and terrorist attacks.